Media Forum: Did Mansfield fail at GCap?

May to September. It sounds suspiciously like a lame and sentimental
sitcom about an unlikely couple, whose ill-starred relationship is
doomed from the start. Which actually, come to think of it, is exactly
what it turned out to be - in the radio version, at least. The one set
in the febrile corporate atmosphere of a newly merged radio
conglomerate. An entity with the devilishly romantic name of GCap.

Yes, it's true - the relationship between David Mansfield and Ralph
Bernard, the joint bosses of the radio company formed in May when
Capital and GWR were shunted together, lasted barely five months. But
then there were those, especially among the investor community in the
City, who would rather the merger had never been attempted in the first
place.

Fans of good corporate governance prefer clean, well-defined organograms
and chains of command. They believed GCap's twin leader structure was a
fudge, designed to symbolise the fact that this was a true merger with
both tribes represented at the very top - Mansfield had been Capital's
chief executive and Bernard was GWR's executive chairman.

Mansfield has always insisted the twin leadership structure would work,
pointing to the clear division of executive responsibilities. Mansfield
was to focus on the day-to-day issues while Bernard would look after
more forward-thinking stuff, such as the evolution of the group's
digital portfolio.

Now, the corporate line is that, having completed the early phases of
integration, Mansfield's job is done. Perhaps, although some in the
industry are sceptical. Others, meanwhile, may surmise that internal
structural issues are unlikely to be the whole story. They could point
to the fact that commercial radio has been hit by the double whammy of
an ad industry slowdown and declining audiences. And, in May, GCap
announced ad revenues for April were down 17 per cent, giving little
cause for optimism for the rest of the year.

Was Mansfield invited to carry the can for that? And, if so, has GCap
actually made its position worse rather than better? Tellingly, Howard
Bareham, the head of radio at MindShare, says there is a lot more work
to be done in melding a coherent single structure out of the various
constituent parts. "No, I don't think they have completed the process,"
he says. "They seem to keep trying to hide behind all sorts of excuses.
Maybe they have to realise that they are now GCap and just get on with
it."

Bareham also thinks digital is something of a chimera - in the short
term, at least. Chris Locke, the group trading director at Starcom,
tends to agree. And he insists that, whatever the company, there can
only be one boss. "Digital is interesting but commercial radio seems to
have stagnated - it's just not sexy any more," he comments.

"And its biggest problem is the BBC. If it can show that it can take the
fight back to the BBC and grow the commercial audience, then the money
will come back. It's as simple as that. GCap is important for the medium
as a whole but others, such as Emap, are important too - and they are
more proactive in the way they approach the market."

Helen Keable, the head of radio at Manning Gottlieb OMD, says Bernard
must now shift his focus from the world of digital possibilities to the
more urgent issue of day-to-day trading. She states: "There is a lot of
goodwill there because everyone - even rival media owners - understands
that we need a strong GCap because it is the leader for the whole radio
industry.

"Digital remains very important for the future of the radio industry and
(Bernard) will ensure that the ex-Capital side of the business benefits
from his experience in that area.

But even in digital I'd like to see GCap doing more to analyse its
brands in order to decide which ones have the greatest commercial
potential."

And Phil Riley, the chief executive of Chrysalis Radio, agrees that
rival groups cannot take much solace from the situation. He explains:
"To a degree, I want GCap to be successful, and to see it stumble is not
good for commercial radio. David Mansfield, in particular, is a great
loss to the industry. In fact, I hope that, in the long term, he will
return to the medium.

"It's important that we are able to attract talented people into the
industry from outside and he was arguably the most successful person to
have done that - he brought a new perception and focus to commercial
radio."

MAYBE - Howard Bareham, head of radio, MindShare

"From my point of view, GCap really has to start getting its act
together. It needs to get the sales teams working as one. It needs to
get them selling across all stations. They need to start being
proactive, too."

NO - Chris Locke, group trading director, Starcom

"The City respected Mansfield initially because of his straight talking
but it's a tough job telling them that radio has just fallen off a
cliff. Radio is going through tough times. The problem was the timing of
the merger."

MAYBE - Helen Keable, head of radio, Manning Gottlieb OMD

"GCap has had a difficult few months since its merger but now it has to
get customer service levels back to where they were. Things take a long
time when you're talking about a deal of this magnitude."

NO - Phil Riley, chief executive, Chrysalis Radio

"It's not easy bolting two businesses together when so many of the
stations face different issues. Any management team would have found
that difficult, especially in the full glare of the City spotlight."